Among High Net Worth consumers, there is a deep appreciation for permanent life insurance. You want every advantage if you currently own or may be considering a jumbo life insurance policy. The underwriting class is major factor in the pricing for:
- jumbo term insurance
- jumbo whole life policy or
- permanent life insurance.
Getting the best underwriting class should be your top priority. To get the best rate possible, your agent must be willing to fight on your behalf.
A small group of life insurance companies specialize in jumbo life insurance underwriting. Insurance companies share underwriting information with one another, which you authorize through the application process. One way they do this is through the MIB (the medical information bureau). The chances of future problems increases if the underwriting process is not being managed properly.
What you need to know:
- Clear the deck. I work with my clients to get an accurate picture of their 5 year history in the insurance marketplace. With it, we create a summary of how much coverage is currently inforce and how much will be replaced, if any. The total amount of inforce coverage at the end of the process is also important to share with underwriters.
- Chronicle the medical history. This helps me understand both current and past health issues which may impact underwriting. We recently helped a 66 year old woman acquire a jumbo policy for succession planning purposes. She had been on lithium for 15+ years without incident. Suddenly, she had developed a lithium tolerance that created some temporary issues. All her inforce coverage was issued on a Preferred Class basis. Knowing the history helped the underwriters understand it was a medication problem and nothing else, leading to a Standard rating for the new coverage.
- Product consideration. Underwriting criteria is often different for permanent and term insurance. Some companies may be more competitive for permanent coverage versus term. In some cases, no offer is made for term. Selecting the right product is complicated. For example, commission amounts, high cash value riders, term blends and special loan provisions should be considered as each can impact price.
A strong cover letter to the underwriters will help them understand your goals and objectives. Often, these jumbo life insurance purchases involve premium financing where the cover letter will be equally beneficial.
Please contact me at 561-869-4500 or email me about a complementary consultation for retirement income solutions and a review of your coverage.
You can visit us at www.facebook.com/lifecycleplanners
https://en.wikipedia.org/wiki/Whole_life_insurance l https://en.wikipedia.org/wiki/Life_insurance#Permanent_life_insurance
Also published on Medium.